Brief of Amici Curiae Distinguished Economists on Rehearing En Banc in Support of the Appellee, TiVo Inc., in Favor of Affirmance in TiVo Inc. v. EchoStar Corp., et al.

EchoStar argues that the panel majority’s ruling (upholding the District Court's contempt proceeding ruling that EchoStar's attempted work around of an infringing device violated the court's injunction, and thus that EchoStar was in contempt of the order) will stifle innovation because fear of the “sword” of contempt will deter infringers from engaging in invention. In contrast, this brief of amici curiae shows that the much greater danger to innovation and the patent system will be caused by an infringer who is not willing to conform to the terms of a permanent injunction. In this case, contempt proceedings are appropriate, and the Federal Circuit should affirm its earlier ruling in favor of the Appellee, TiVo. It should do so by using a simple, analytical approach to contempt proceedings that is based on the doctrine of equivalents. A trial court’s decision to enforce an injunction by issuing a contempt judgment depends on two prior steps: a determination that some expedited procedure focusing on compliance with the injunction is more appropriate than a subsequent new jury trial on the question of patent infringement, and a determination that contempt occurred. The overall process should satisfy several important objectives: (1) maintaining consistency with legal precedent, (2) fostering efficiency and due process, and (3) preserving incentives to invent, incentives to invest in and commercialize new technologies, and third-party incentives to avoid infringement and to design around. The combination of these objectives would be best satisfied if courts base their decisions on a doctrine of equivalents comparison between the newly accused device and the initial infringing device. Consistency, efficiency, fairness, and appropriate deterrence all demand that a newly accused device that is “equivalent” to the infringing device be adjudicated in a proceeding like contempt that affords both expedited process and the possibility of heightened penalties.